The townspeople appear in the episode "His Hero." They are the poor inhabitants of the unnamed town, and they eat Finn and Jake's gruel when Finn and Jake try to help people nonviolently. However, Finn adds a Stone-skin potion to the gruel, thinking it will help the townspeople defend themselves, though this backfires, as they are all upset after growing the armor. One individual is especially freaked out when his bellybutton starts shooting fire.
One of the townspeople who appears in "His Hero" also appears briefly in "The Eyes" when Finn and Jake save him from a dragon. This encounter is similar to the first encounter with the Cobbler when Finn and Jake first try nonviolent methods after Billy convinces them to try it.
Several of them make cameos in the episode "Blade of Grass" when Finn visits the market for a new sword.